Signature Bank Becomes Third US Bank to Fail in a Week
New York Regulators Shut Down Signature Bank
Signature Bank, one of the two significant banks for the crypto industry, has also been shut down by the New York regulators — the third US bank failure within a week. US Treasury Secretary Janet Yellen, Federal Reserve Board Chair Jerome Powell and Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg said in a joint statement that all depositors of Signature Bank will be made whole.
New York Department of Financial Services Takes Possession of the Bank
Signature Bank had $88.59 billion in deposits as of December 31, 2022 and the New York Department of Financial Services has taken possession of the bank, reports The Verge.
Coinbase and Circle Affected
Leading crypto exchange Coinbase had $240 million in cash at Signature Bank. “As of close of business Friday March 10, Coinbase had an approximately $240m balance in corporate cash at Signature. As stated by the FDIC, we expect to fully recover these funds,” the crypto exchange said in a tweet. Circle, the firm behind USDC stablecoin, is also affected by the Signature Bank closing. Its CEO Jeremy Allaire said in a tweet that with the closure of Signature Bank, “we will not be able to process minting and redemption through SigNet, we will be relying on settlements through BNY Mellon”. “Additionally, we will be bringing on a new transaction banking partner with automated minting and redemption potentially as soon as tomorrow. We are committed to building robust and automated USDC settlement and reserve operations,” he added.